Do You Know Your 401(k) Fees?

October 26th, 2007 at 01:43 pm

Most people don't know how much they are being charged in sponsor fees for their 401(k)s. That's because current retirement savings law, pased in 1974, doesn't explicitly require plan sponsors to disclose comprehensive information on fees. But even small fees can add up. Say a 45 year old puts $20,000 in a 401(k) account until retirement and gets a 7% return, but is charged a 1.5% fee. Instead of the account growing to $70,500, the person will only have $58,400 when he retires. That's a big difference. Do you know what sponsor fees you are being charged on your 401(k)?